RBI allows urban cooperative banks to transition into Small Finance Banks

Large multi-state UCBs also allowed to become companies

The Reserve Bank of India (RBI) has allowed for the voluntary transition of large multi-State urban cooperative banks (UCBs) into joint-stock companies. It has also allowed other UCBs that meet certain criteria to become Small Finance Banks (SFBs).

The High-Powered Committee on Urban Cooperative Banks (UCB), chaired by R Gandhi, the then Deputy Governor of Reserve Bank, had recommended the same in August 2015. Taking these recommendations into consideration, it has been decided to allow the voluntary transition of UCBs meeting the prescribed criteria into SFBs, said the central bank in its ‘Statement on Developmental and Regulatory Policies’.

“Demand from